On February 1, 2025, President Donald J. Trump announced the
imposition of new tariffs on imports from Canada, Mexico, and China,
citing national security concerns related to illegal immigration and
drug trafficking. The measures include a 25% tariff on imports from
Canada and Mexico, with a reduced 10% tariff specifically on Canadian
energy resources, and a 10% tariff on imports from China. - whitehouse.gov
As of February 3, the 25% additional tariffs on Mexico imports have
been put on hold for 30 days due to current talks. – Reuters.com
Trade Volume with Canada and Mexico
According to data from the U.S. Census Bureau, in the first ten
months of 2024, the United States engaged in substantial trade with
both Canada and Mexico. Total trade with Canada amounted to
approximately $699.6 billion, with U.S. exports to Canada totaling
$322.4 billion and imports from Canada at $377.2 billion. - census.gov
In the first three quarters of 2024, goods and services
worth approximately US$600 billion crossed the U.S.-Canada border.
When including trade in services, this figure rises to US$683
billion., with nearly US$350 billion in goods and services exported to
Canada during this period. This data underscores Canada's position as
a key trading partner for the U.S. - economics.td.com
In the first ten months of 2024, according to data from the U.S.
Census Bureau, trade with Mexico was even more significant than with
Canada, totaling around $776.0 billion. U.S. exports to Mexico were
valued at $309.4 billion, while imports from Mexico reached $466.6
billion. - census.gov
Regarding Mexico, in 2023, the U.S. imported goods and
services valued at $530 billion and exported $367 billion to
Mexico. The machinery and equipment manufacturing sector, which
includes automotive and parts, accounted for $193 billion of U.S.
imports from Mexico, while electronics manufacturing contributed $119
billion. These two sectors also represented significant portions of
U.S. exports to Mexico, totaling $67 billion and $65 billion,
respectively. - scotiabank.com
These statistics illustrate the critical importance of Canada and
Mexico in U.S. trade dynamics, reflecting the extensive economic ties
that have been fostered over the years.
China's Response
In response to the U.S. tariffs, China's Ministry of Commerce
condemned the action, announced plans to file a legal case against the
U.S. at the World Trade Organization, and stated that China "will
take corresponding countermeasures to firmly safeguard its rights and
interests." - fmprc.gov.cn
Global Economic Implications
The announcement of these tariffs has led to significant reactions in
global markets. Major stock indices have experienced declines, and
there is heightened concern about potential disruptions to
international trade and economic growth. - theguardian.com
Economists and industry leaders have expressed concerns that the
newly imposed tariffs could lead to increased costs for consumers and
businesses, potentially contributing to higher inflation and affecting
employment in industries reliant on international trade. A model
gauging the economic impact of President Trump's tariff plan from EY
Chief Economist Greg Daco suggests it would reduce U.S. economic
growth by 1.5 percentage points this year, potentially ushering in
"stagflation"—high inflation, stagnant economic growth, and
elevated unemployment. - reuters.com
Additionally, North American companies are preparing for the effects
of these tariffs, which threaten to disrupt numerous industries,
including automotive, consumer goods, and energy, leading to increased
costs and potential production delays. Industry leaders express
concerns over increased costs for consumers and possible supply chain
disruptions. The tariffs could harm industries on both sides of the
border, affecting auto manufacturing, fuel, and consumer goods
sectors. - reuters.com
The tariff situation is consistently evolving. Discussions are
ongoing among the involved nations and within the global economic
community regarding the potential impacts and future developments
related to these trade measures. GVSU’s Van Andel Global Trade Center
will continue to post updates as they occur.
February 3, 2025
As trade advisors and consultants, one of the most common questions
we hear from small and mid-sized businesses is: “Do we need to
worry about Customs compliance?” The short answer? Yes—absolutely.
Often, the realization of the importance of compliance is triggered
by a new hire, an internal audit, or as international trade becomes
more integrated into day-to-day operations. No matter how the
awareness begins, businesses need to understand that compliance risk
is a hidden but significant challenge when working with partners
outside the U.S.
Uncovering Compliance Risks: The Role of Customs Entries
When we first walk into a business, we don’t know much about its
import activity or the processes they have in place. Some companies
have oversight mechanisms; others assume everything is running
smoothly simply because shipments arrive on time. The truth is, within
the first five minutes, we can usually gauge their level of compliance
oversight. How? By asking one simple question: “Where are the
customs entries?”
Customs Entries Hold the Key
Customs entries are the foundation of any import operation. They
reveal critical details such as:
- The number of entries filed over a given period.
- Where the entries are being filed.
- Who is responsible for filing them?
If a company cannot provide these answers, tracking down customs
entry data often uncovers previously unknown trade lanes and hidden risks.
The second question we ask is equally telling: “Where are the
records?” Responses often include:
- “I’ve never seen the customs entries.”
- “That’s the customs broker’s job.”
- “I assume someone else handles that.”
In many cases, customs entries are sent to Accounts Payable with the
broker’s invoice and then filed away—never to be seen again. This lack
of oversight can expose the company to significant compliance risks.
The Importance of Oversight and Recordkeeping
Customs entries are official government filings, akin to
transactional tax returns. They rely on accurate import
documentation—particularly the commercial invoice. Errors in value,
classification, or country of origin can lead to costly penalties.
While customs brokers file these entries on your behalf, they act as
service agents and are not held liable for errors. The responsibility
for compliance rests squarely on the importer, as mandated by Customs
under the principle of “Reasonable Care.”
To safeguard against these risks, companies must establish robust
internal controls, including:
- Reviewing customs entries against commercial invoices and an
audited Harmonized Tariff Schedule (HTS) classification list.
- Promptly addressing errors with customs brokers.
- Maintaining a secure record retention system indexed by entry
number, date, supplier name, and related documentation.
By implementing these measures, you’ll be well-prepared to answer the
pivotal question: “Where are the customs entries?”
Take the First Step Toward Compliance
Ready to build confidence in your importing practices? Join us for
Van Andel Global Trade Center’s “Basics of Importing”
training. This workshop will provide the foundational knowledge you
need to navigate U.S. Customs regulations, manage compliance risks,
and import goods effectively and efficiently.
Visit our Upcoming Events page to register and take the
next step toward a more informed and compliant import process.
January 16, 2025
by Luke Notorangelo
The United States-Mexico-Canada Agreement (USMCA), which replaced
NAFTA on July 1, 2020, aimed to modernize trade between the U.S.,
Canada, and Mexico, incorporating more flexibility and advanced
technological strategies. The article
Driving
Capital underscores how the USMCA and the Inflation
Reduction Act (IRA) have catalyzed job creation and investment
in Michigan, especially in the automotive sector’s shift toward
sustainability. The
Wilson Center's analysis further highlights the USMCA's role in
strengthening supply chains and addressing geopolitical challenges.
Meanwhile, the Atlantic Council notes that upcoming elections in
Mexico and the U.S. could significantly influence the Agreement's
future. Collectively, these perspectives reveal the USMCA’s pivotal
role in shaping economic resilience and sustainability across North America.
Impact on Michigan’s Labor Market
The USMCA has significantly impacted Michigan's labor market,
particularly in the automotive industry, driving job creation and
investment in electric vehicle manufacturing. The Agreement's
requirement that a substantial portion of automotive content be
produced by workers earning at least $16 per hour is a key step in
raising wage standards and supporting labor rights. Mechanisms like
the Rapid Response Labor Mechanism (RRLM) empower workers to report
labor violations, enhancing protections.
However, there are challenges. Some Michigan companies have closed
operations in Mexico due to compliance issues, raising concerns about
job stability and competition. This underscores the delicate balance
Michigan workers face as the automotive sector evolves.
With the IRA encouraging growth in Mexico’s automotive sector,
Michigan’s labor market stands at a crossroads—facing both
opportunities and uncertainties. The
upcoming USMCA review in 2026 will likely shape the future for
workers and businesses alike, offering a chance to critique and adjust
the Agreement to ensure long-term benefits for North American trade.
Four Years of USMCA: Looking Ahead
Despite global supply chain challenges such as the COVID-19 pandemic,
Russia’s invasion of Ukraine, and tensions with China, trade
between the USMCA nations has surged by 50%. This growth
underscores the strength of the Agreement in managing trade disputes
and overcoming supply chain disruptions. Beyond economics, the USMCA
reflects a broader shift in globalization, emphasizing sustainability,
transparency, and resilience.
As the USMCA reaches its fourth anniversary, it’s clear that while
much has been accomplished, unresolved disputes and future challenges
remain. Elections in Mexico, the U.S., and Canada could introduce new
policies that reshape the trade landscape. Monitoring these
developments is essential to maximizing the Agreement’s potential and
ensuring a successful 2026 review.
The 2026 USMCA Review: Why It Matters for Michigan Trade
The USMCA includes a unique review process, with a critical
evaluation scheduled for July 1, 2026. This review will determine
whether the Agreement will be extended for another 16 years or if
periodic evaluations will occur. The review will focus on compliance
in key areas like telecommunications and labor rights. As political
debates intensify, particularly around migration and drug trafficking,
Mexico must solidify its position as a reliable partner in North
American trade to ensure a successful review.
USMCA in 2024: Notable Considerations
As we mark the fourth anniversary of the USMCA, it's evident that the
Agreement is more than just a trade deal—it’s a vital support for
Michigan's labor market and a symbol of resilience for North America’s
economic future. Growth in the automotive sector and broader trade has
positioned the region toward a more sustainable and equitable economy.
Yet, upcoming reviews and elections could significantly reshape this
framework, making it crucial for businesses, workers, and policymakers
to stay engaged. Decisions made now will impact job stability and
competition in Michigan, laying the foundation for a stronger North
American economy.
Expand Your Knowledge of International Trade
Looking to deepen your understanding of The United
States-Mexico-Canada Agreement (USMCA)? Join us at an October, Basics
of USMCA training event! Learn valuable insights, expand your network,
and discover how the Van Andel Global Trade Center can support your
international growth. Register today to
secure your spot!
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About the Contributor
Luke Notorangelo is currently a Marketing and Sales Student Assistant
at the Van Andel Global Trade Center. Luke is a senior studying
Business Administration with a concentration in Marketing at Grand
Valley State University. He enjoys going to the gym, watching a good
sports game, spending time with friends, and exploring new noteworthy
restaurants in the area.
October 11, 2024
By CNBC's Lori Ann LaRocco
Billions in trade came to a screeching halt at U.S. East Coast and
Gulf Coast ports after members of the International Longshoremen’s
Association, or ILA, began walking off the job after 12:01 a.m. ET on Tuesday.
The ILA is North America’s largest longshoremen’s union, with roughly
50,000 of its 85,000 members making
good on the threat to strike at 14 major ports subject to a
just-expired master contract with the United States Maritime Alliance,
or USMX, and picketing workers beginning to appear at ports. The union
and port ownership group failed to reach agreement by midnight on a
new contract in a protracted battle over wage increases and use of automation.
In a
last-ditch effort on Monday to avert a strike that will cause
significant harm to the U.S. economy if it is lengthy — at least
hundreds of millions of dollars a day at the largest ports like New
York/New Jersey — the USMX offered a nearly 50% wage hike over six
years, but that was rejected by the ILA, according to a source close
to the negotiations, who was granted anonymity to speak about the
private negotiations. The port ownership group said it hoped the offer
would lead to a resumption of collective bargaining.
Read the full article here.
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CNBC This piece of content has been aggregated from
an outside website.
October 2, 2024